Leaders from the American College of Surgeons (ACS) and Harvard Business School’s (HBS) Institute for Strategy and Competitiveness gathered on Capitol Hill to announce a new partnership aimed at improving health care value. The two organizations announced a new program to help hospitals and surgical practices improve patient outcomes while lowering the cost of delivering care. Better measurement of quality and costs will enable hospitals to improve the value they deliver to patients while positioning them for success as reimbursement shifts to bundled payments, an approach that increases transparency and accountability.
“Clearly defining the value of patient care is critical to our nation’s health care system,” said David B. Hoyt, MD, FACS, executive director of the American College of Surgeons. “As the patient care model continues to evolve, we must place a premium on providing the utmost quality and efficiency in our hospitals. This program will help hospitals identify clear opportunities to do that.”
At the event on Capitol Hill, leaders of the program, called ACS THRIVE (Transforming Health care Resources to Increase Value and Efficiency), discussed the challenges the nation’s health system faces as it moves from volume to value-based payment models, the changing team dynamics within hospitals, and the new care models that health systems must adopt.
“We want to reduce the high costs incurred in the U.S. health care sector, but do this in ways that don’t compromise the quality of care or a patient’s access to it,” said Prof. Robert Kaplan, MS, PhD, senior fellow and Marvin Bower professor of Leadership Development, Emeritus, HBS. “Cutting costs by arbitrary reduction in headcount is not a sustainable solution. True cost improvement requires that we first measure what it costs today to treat a patient’s medical condition, and then redesign the care model to deliver the same or, preferably, better outcomes with a lower-cost mix of resources, especially personnel, equipment, devices and drugs.”
“Surgical care is more than just the operative procedure,” said Frank G. Opelka, MD, FACS, medical director, ACS Quality and Health Policy. “Surgical care involves teams of clinicians who begin delivering care in the preoperative phase, include anesthesia, nursing care and medical specialties and continues through to postoperative rehabilitation. As a team, we need to optimize each phase of care to provide the best outcomes for patients and meet their goals.”
Initially, ACS THRIVE leaders will pilot the value-measurement process with 10-15 hospitals in the U.S., focusing on measuring the full cycle of care – including its key surgical, medical, behavioral and social elements – for three surgical conditions. Results from the pilot will be used to create a scalable approach that all hospitals can use to measure and improve value. The method will also include risk-adjusted benchmarks, so hospitals can compare its value with one another to generate system-wide improvement. High-value providers will be recognized, while those with opportunities for improvement can learn from the best practices of the high-value hospitals and health systems.
The new program will build on the two organizations’ expertise in cost and quality measurement. ACS first proposed its Hospital Standardization Program in 1912, which evolved to become The Joint Commission. In 1922, the ACS created the Commission on Cancer, which today sets standards used by 80 percent of U.S. cancer centers. In the 1960s, the ACS Committee on Trauma helped establish the nation’s trauma system. And in the early 2000s, the ACS launched the National Surgical Quality Improvement Program (ACS NSQIP) for collecting clinical, risk-adjusted, 30-day surgical outcomes data.
“We know quality improvement requires accurate and reliable data, with risk and case-mix adjustment,” said Clifford Ko, MD, MS, MSHS, FACS, FASCRS, director of the ACS Division of Research and Optimal Patient Care. “Clinical data, not claims data, are routinely the best data to use. However, data alone are not sufficient. Appropriate and adequate resources, infrastructure and adherence to evidence-based standards are all likewise needed to provide high-value care. ACS has a long history of helping providers and hospitals achieve these aspects reliably.”
The HBS Institute for Strategy and Competitiveness was founded by recognized business strategy leader Michael Porter. His 2006 book, Redefining Health Care, laid the groundwork for how to measure value in health care. The Institute’s leaders, including Prof. Kaplan, have created some of the most important business strategy and cost-measurement methods in the world, including time-driven activity-based costing, or TDABC, an accounting method that is recognized as one of the most effective means of measuring and improving an organization’s costs.
“We believe the value-based health care approach will expand the definition of quality and will improve transparency, both of which are essential to delivering truly patient-centered care,” said Mary L. Witkowski, MD, MBA, Fellow, HBS Institute for Strategy and Competitiveness.
“This is the next evolution of our nation’s health system,” Dr. Hoyt said. “We know we can provide world-class care to all patients. Now we need to make that care affordable and accessible to all in a way that meets the patient’s goals.”